OPENING CALLS:
| Class III Milk Futures: | 10 to 25 Lower |
| Class IV Milk Futures: | 5 to 15 Lower |
| Butter Futures: | 1 to 2 Lower |
OUTSIDE MARKET OPENING CALLS:
| Corn Futures: | Steady to 1 Lower |
| Soybean Futures: | 5 to 7 Lower |
| Soybean Meal Futures: | $2 to $3 Lower |
| Wheat Futures: | Mixed |
MILK:
Milk futures have been under substantial pressure over the past two days and it looks to continue today based on overnight trading activity. Trading volume was again higher than usual for an overnight session. The negative reaction may be due to the finding of the HPAI virus in milk and that it may be more widespread in dairy cattle than reported. USDA is requiring mandatory testing for the interstate movement of dairy cattle. This will put an added burden on those who have their heifers custom-raised in another state as well as those who purchase replacements out of state. However, the greater issue could be the reaction of consumers to the genetic material of the virus being found in retail milk samples. Milk that is pasteurized is safe but the perception of consumers will impact the market.
CHEESE:
The March Cold Storage report was bullish for the cheese market as American cheese inventory declined from the previous month and showed little change from a year ago. Total cheese stocks were unchanged from the previous year indicating production is in line with demand. This could support the market as the year progresses and demand improves.
BUTTER:
Butter is down but not out. Demand is holding well and inventory in March was only 2% above a year ago. The industry has been intent on building inventory ahead of the summer when the cream supply tightens. They want to have a cushion for later demand. Price will likely find support near the current level.
